What is a Financing Contingency?

If you’re buying a home in Baton Rouge or any of the surrounding communities, your Realtor® will most likely build a financing contingency into your real estate purchase contract.

But what is a financing contingency, and why do you need one?

What is a Financing Contingency?

A financing contingency is an “easy out” built into your purchase contract that lets you cancel a transaction if you can’t get financing. (With a financing contingency, you’ll be able to keep your earnest money deposit in most cases, too.)

Usually this clause in your contract gives you a certain amount of time to apply for a mortgage or close the loan.

Why You Need a Financing Contingency

If you have a financing contingency in your real estate purchase contract, you’re protected if you’re not able to get financing. It can be very specific, but the main idea is to make sure you’re not caught in a tough spot if you can’t get financing.

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Featured Properties

Did you know the hottest homes for sale in greater Baton Rouge often sell within days of being listed? Don’t miss out! Set up your own custom property alert so you can be notified of the newest homes as they hit the market! Simply click the button below and choose the qualities that you want most in a home and save your search to start getting alerts today!

As local Baton Rouge Real Estate Agents we also have access to homes before they hit the market and can show you more homes and information that are only accessible in the MLS. If you would like to set up a time to go over your real estate needs, please free to contact us at your convenience. There is no obligation and or pressure… we hope to hear from you!